JPY Soars Back
On Minister Amari Comments; Onto PPI&Retail Sales
JPY pairs
plunge; British CPI steady; Eurozone trade surplus rose; Fitch warns Spain.
Retail sales, PPI and empire state manufacturing are next.
After a long
holiday weekend, JPY crosses pushed
higher but then fell sharply lower after Japanese economy minister Amari warned
over excessive weakness of the JPY that could lead to "negative effects on
livelihoods". A number of officials noted the speed of JPY depreciation
over the past few days. USDJPY fell from 89.60 to 88.35 and EURJPY from 119.97
to 117.80.
On the data
front we learned that British consumer inflation was steady in December at 2.7%
y/y while the core figure eased to 2.4% from 2.6% and that Eurozone trade
surplus rose to EUR 11.0 bln in November from prior EUR 7.4 bln. GBPUSD and
EURUSD are weaker and trade near session lows around 1.6040 and 1.3330
respectively.
In other news,
Spanish yields ignore Fitch ratings comments that the country is at a risk of a
downgrade even if it manages to avoid going into the rescue program. The 10
year yield continues to trade below 5%. CHF continues to weaken across the
board which pushed EURCHF higher again to 1.2386.
The US session
begins at 8:30 am ET with retail sales that are seen growing 0.2% in December
from prior 0.3%. Core sales are expected to rise 0.2% after a flat reading in
November. Producer prices are forecasted to ease to 1.4% from 1.5% on annual
basis and core PPI is seen at 2.1% from 2.2%. Last on the list is the empire
state manufacturing index that is anticipated to improve to 1.9 in January from
-8.1 which would be the first positive result after five months of sub zero readings.
Patrik Urban
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